The transition from the C-suite to the boardroom then to board leadership can cause some growing pains and create some gray area in understanding your role and responsibilities. James White and Keith Meyer explore the new skills you needed to develop to become an effective board member, the impact of being a diverse board chair, and how to adapt your leadership style to your evolving board roles, focusing on James’s personal transition from the CEO role to an independent director and then to board chairman.

TRANSCRIPT

[00:00:00] This is the craft of governance a podcast providing insight into the boardroom.

Keith Meyer: [00:00:13] Welcome everyone to the Directors Academy podcast series focused on the craft of governance. It’s sponsored by Allegis Partners. I’m Keith Meyer, the president and one of the founding board members of the Directors Academy. During this series of podcasts, we will invite a number of our faculty members to share their unique insights and perspectives on key elements of corporate governance and board leadership from intimate individual committee best practices to developing effective working relationships with the CEO and a host of other matters.

[00:00:43] Today’s topic is transitioning from a board member to a board leader, and we’re pleased to have James White with us. James was a chairman and CEO of Jamba until his recent retirement. He’s been on corporate boards for many years, including being the chair today of the Adtalem Global [00:01:00] Education board, the chair of Bradshaw International, a director of Panera Bread company, and he previously was chairman of Damon worldwide and also a director of Callidus Cloud and Hillshire Brands, amongst other boards. James also was one of our founding board members for the Directors Academy.

[00:01:16] Today we’re going to cover five topics with James. The first is the transition from the CEO role to an independent director and some of the new skills and impact that you had and during and after that transition. The second would be the area where you observe directors getting into trouble and having some issues where they try to add value on their boards and may be struggling.

[00:01:41] A third area would be around your recent transition into the board chairman role and leading the board and how you think about those leadership capabilities relative to your prior board service and then we’re also going to talk about the impact of being a diverse board chair and how that may or may not influence [00:02:00] how you lead the board.

[00:02:00] So James great to have you with us. Why don’t we just kick off with that first? You went from being a high-performing CEO of working with the board to then stepping over while you were CEO into public and private company boards where you were the board member and discuss kind of that transition and how that went for you

James White: [00:02:20] Keith, the first one I’d make is is really just the difference between between being an operating manager or chief executive. And you know playing more governance role from a board perspective and really is you walk in to the boardroom understanding the difference you decide to take my management leadership hat off from an operating perspective and then move to a governance perspective in the boardroom.

Keith Meyer: [00:02:49] And the board’s collectively a group of peers. It’s not a hierarchical organization, entity, or element. And I think as a CEO you [00:03:00] probably led one way, but you contribute a differently in the boardroom. Is that fair?

James White: [00:03:03] When the boardroom you needed to have a mindset on how and where you might add value is at least the way I thought about it, and you know, my operating experience would be one, some of the industry sectors that I’ve worked in would be a second place where value gets added in the boardroom.

Keith Meyer: [00:00:20] What was the preparation like as you became more proficient as a board member and you still had your day job as CEO. How did you start to plan and effectively prepare for board meetings and did that change over time?

James White: [00:00:05] You know for me in the board’s varied. I mean some were in the consumer products industry. Some would have been in more retail-oriented industry. So it might require field visits to factories, it might have me going into retail shops in the case of you know, restaurant chain like Panera we’ve got cafes and [00:04:00] then really studying the industry on an ongoing basis is important part of the preparation coming into the meetings and ongoing.

Keith Meyer: [00:00:31] And during that time when you were in your initial stage of your board experience, were you getting much feedback from the board chairs or the lead directors or even the CEOs around your contribution or was that sort of a feel it as you go experience?

James White: [00:00:16] My first board service was about a billion dollar company. It was in the IT services kind of tech space. So it was a space where I didn’t really have domain expertise, but I brought value based on my leadership experience. So that one, you know, I really needed to learn both the industry and try to come up to speed and then be able to add value from a leadership perspective to the organization. So I solicited feedback from [00:05:00] both the chairman of the board and the management team because I was looking for a way to add value to the organization.

Keith Meyer: [00:00:57] Different domain different sector for you. Yeah. Shifting to our second topic today observations on what differentiates higher-performing directors from other board members, and where do you think, if there are kind of typical areas where directors struggle that aren’t performing well, what those areas might look like and how you kind of avoided that.

James White: [00:01:24] I think the most critical thing always is to understand the context in which the company is operating because in my experience and that makes money how the organization makes money but kind of the the overall kind of industry construct, who the competitors are, and then where the critical places where the board can [00:06:00] actually add value. And you know, for me, if I just put my CEO hat on, it was always very important to help the board understand where I felt like I needed help and then you could concentrate the effort and get good questions and kind of the best thinking from a board. I think where things go a little bit astray is where a board member has an area of expertise and they’re going to share that expertise no matter what, whether it’s relevant helpful, it’s just an expertise not, you know, applied to create value.

Keith Meyer: [00:00:05] They just automatically want to share that with the board and the management team right? Have you seen issues where maybe the CEO doesn’t understand where to pull value out of their board and that sometimes can create a different dynamic where the board struggles to be effective because the CEO doesn’t know how to engage with their own board?

James White: [00:00:21] Yeah, I have seen it both ways, and I think the highest-performing [00:07:00] boards and chairmans and CEOs do a great job on the intake or the onboarding. So the there’s magic in the onboarding of a new director where there is constructive feedback ongoing. I’ve got a situation with one of the boards that I sit on the day, and we’ve added three new directors and one of the things that I have work to do is have a very specific discussion with the individual directors on how between myself and the CEO we see them adding value so there’s no confusion. There might be other areas where that individual can add value but one or two places where we know they can help us advance.

Keith Meyer: [00:00:07] You set expectations, even before they start their first board meeting.

James White: [00:00:11] We try to build it into the onboarding process as well.

Keith Meyer: [00:00:17] What was it like transitioning from the board member role into either the committee chair role and or than the board chair role and were there [00:08:00] differences in how you needed to think about adding value in those different roles as a board member?

James White: [00:00:34] Yes, I think that overall from a board member perspective, once you have your committee assignments, you’re really just trying to understand how to add value on that committee and to be a contributing member on that committee, which is very different than, you know, leading a committee. One of my first committees that I chaired would have been the compensation committee. As chair of a committee, you’re going to work with the external resources; you’re going to work with the members of the board; and you’re also going to work with the management team kind of the key leader of the management team to facilitate that work. And it’s just a different level of strategy work. There’s a little bit broader context required to kind of lay out the, the game plan for the committee and then the board chair work is dramatically different than [00:09:00] either board member or committee. Your key resources end up becoming, the general counsel ends up being just critically important; the relationship with the CEO is very important; and then the relation with each individual member of the board becomes critically important to a high-performing well-functioning board.

Keith Meyer: [00:01:52] How did if this came up? How would you or did you handle a board member that was not performing to the expectation versus being a CEO with a leadership team member where you had to coach and develop? Is it different if you have a board member that struggling and you’re the committee chair the board chair and how did you address that?

James White: [00:02:13] I think for me now, one of the, and I’m almost a year into chairing my first public company–I’ve chaired private company board–but as chair of relatively high-performing board, I [00:10:00] followed what I thought was a great board chair and one of the practices that I’ve put in place is post-each board member meeting, I solicit feedback on things that the management team could have done better or differently. I also get feedback on things that I might have done differently in terms of organizing, constructing, or guiding the meeting agenda differently, but I also take it as an opportunity provide feedback to the individual board member on this was super helpful, or that issue you brought up in the broad board meeting, that would be better served if you would have handled that kind of offline with a specific member of the management team.

Keith Meyer: [00:00:15] Do you do that as part of the executive session with the full board or individually give that feedback to board members?

James White: [00:00:21] That would be individually as a practice.

Keith Meyer: [00:00:25] How’s that gone?

James White: [00:00:27] It’s been well received because [00:11:00] everybody…there’s no lack of clarity and in terms of expectations. And it’s creating a bit of a, you know, better alignment.

Keith Meyer: [00:00:39] Have you been able to take any of your prior private company board leadership experience and translate that into the public company setting or where do you see differences in? How do you think about adjusting your leadership style and your private company board versus the public company?

James White: [00:00:53] Well some of the private company experience that I cherish the most is they spend much more time on the big picture strategy and then they use each board meeting most of the time to go deep on how the strategies being operationalized. So for me that is becoming increasingly a part of where I focus on in any of the public company boards that sit on.

Keith Meyer: [00:00:19] Versus the public company boards are always a host of opportunities to get distracted by [00:12:00] Regulatory Compliance and a whole host of other topics and not spend time as a board on…

James White: [00:00:29] …On strategy and how the strategy is…

Keith Meyer: [00:00:31] So that’s kind of a challenge…

James White: [00:00:33] Can be a little bit of a challenge.

Keith Meyer: [00:00:36] You’ve had experience with activists and having activists come into your company a CEO. As a board leader today, do you think differently about activism and how a board needs to be prepared whether an activist is in play or not in play and how do you think about that from a board leadership standpoint?

James White: [00:00:59] From a board leadership perspective, I think if the board is more actively engaged in both the strategy and how the strategy gets operationalized, and then where there are gaps or challenges or issues, the board is engaging management around a game plan. [00:13:00] That’s the best way to guard against any concerns that you’d have from an activist perspective. So the engagement level of the board needs to just be a lot greater than I would have thought about it. Historically, you know having had activist approach companies that I’ve been involved with the board around and actually sit in the boardroom, and one of the cases when I was CEO, there are things that probably would have done differently knowing exactly what I know today.

Keith Meyer: [00:01:59] So you almost as a board member have to think as a disruptive…not as the disruptive activist, but you have to bring him a mentality of being more proactive around what could be disruptive to the company and then start to proactively work.

James White: [00:02:11] And at a minimum, Keith, you’ve got to actually ask those questions and kind of, you know, put the the lens of an activist on and say where do we have opportunities

Keith Meyer: [00:02:21] …And engage the board…

James White: [00:02:23] …And then engage the board [00:14:00] around those opportunities.

Keith Meyer: [00:02:27] Being a diverse board leader a diverse C, formerly CEO, do you bring a different lens to board leadership and you have a different perspective on maybe empathy or other areas of board leadership than some of the other board leaders you’ve observed that aren’t haven’t been diverse or do you think it’s all the same?

James White: [00:02:47] Yeah, I guess I guess for me and it’s it’s a personal makeup. So I bring a mindset that is inclusion kind of by design from a leadership perspective. So that’s kind of my in going kind of…

Keith Meyer: [00:03:01] That’s just you as a person.

James White: [00:03:02] That’s me as a person. It’s a core value, it’s something I look for in the boards that I joined because kind of, you know, alignment around the vision and mission ends up being important for me with the companies and the boards that I go into. And I’ve been, you know, quite fortunate the board that I [00:15:00] chair today, Adtalem Global Education, we have an African-American woman who’s our CEO, Lisa Wardell, just a dynamite CEO, one of the top women CEOs in the in the country in my humble opinion. We’ve got an incredibly diverse board that includes four women, we’ve got, you know, four people of color on that same board, so we got we kind of live in this way and there’s great alignment across the board is something we talked about as an organization. We’ve got a very diverse management team, and you know, the constituent would see that we serve from an education perspective, you know, from nursing to our medical schools is a highly diverse population of students that we serve.

Keith Meyer: [00:04:16] And there’s an element of purpose-driven corporate objective here. If you think about board service, do you feel it’s important have alignment around kind of the [00:16:00] purpose and the mission of the organization as well as the quarterly “how much money did we make” and “what’s the share price today” if you’re a public company and how do you translate that into your board leadership?

James White: [00:04:35] I think at least for us at Adtalem, that’s a central part of what brings all of the nine-member board together at Adtalem. The mission is, but you know, a rallying point of alignment for us all.

Keith Meyer: [00:04:48] Last question, James: If you look back today based on all of your cumulative board experience and you went back to where you started in your first board, would you do anything differently today based on what you’ve known what you know and what you’ve seen on that first board or would you have done it exactly the way you did it back then?

James White: [00:05:06] I think the one thing that I might have done differently is I might have been a more active learner in thinking about the long-term for the companies whose boards I was serving on, kind of taking a 5- or 10-year perspective and then kind of walking back [00:17:00] to today. It would provide a couple of things. It would guide my own preparation differently. It would reshape some of the questions that I posed in the boardroom slightly differently with the much longer term…

Keith Meyer: [00:00:13] Versus just dealing with the board meeting agenda. And what was happening in that…

James White: [00:00:17] …Board meeting agenda the quarterly performance, the annual performance because the truly defining companies kind of overtime are going to have a longer term perspective on how they execute their strategy…

Keith Meyer: [00:00:32] And the board should be leading that conversation.

James White: [00:00:34] The board has to push managament kind of out of the quarter-to-quarter rigor, but even as a board member is I look at where we sit today. The need for corporate directors to build their own skill sets moving forward is increasingly more important in addition to [00:18:00] their own operating experience. So for me, over the course of the last year or so, I’ve spent a lot of time working on my own skill set in preparation for the future so I can add more value in the boardroom. If you look at the disruptive change that the exponential technologies, like robotics and artificial intelligence, are having on most businesses, it’s just a it’s a prerequisite that the board members are at least familiar with those technologies in the potential implications for their businesses.

Keith Meyer: [00:01:31] So as you bring that continuous learning into your boardroom, do you find a receptive audience with the other directors or do they just sort of look at you like well, there’s James going off again on disruptive technology and we’re fine with the business model and you know for the next 24 to 36 months we can keep going. Is there a tension in the boardroom around that or do you think that that’s becoming more accepted that, “yeah, this just disruption is going to affect us and we have to be ready sooner rather than later?” [00:19:00] How do you sense that attitude in the boardroom?

James White: [00:02:01] Yeah, I think there is an openness to it. But you know for me as a as a board member, I’m not trying to just bring back the new knowledge that I have. I try to put it in the context of the industries that we sit in. So, I mean there’s a thoughtfulness that needs to happen on my part in terms of how and where I engage either the board, the management team, or the CEO.

Keith Meyer: [00:02:25] Because as chairman, you have a large degree of control over the agenda and where the board spends its time. So you could effectively direct the board’s time into areas much differently than maybe the board has spent time in the past. Right?

James White: [00:02:38] Yeah, but I view my role as more facilitating. My view as board chairman is to really firstly make sure that the board is truly an asset to the CEO and management team is kind of job one. Job two is to help the CEO and management team access all the talent on the board, so [00:20:00] the board becomes truly strategic advantage kind of longer-term to the company in the mission of the company.

Keith Meyer: [00:03:07] Thank you, James. We appreciate all you do for the academy . We invite everyone to come back and enjoy the next podcast in a couple weeks, and we also thank Allegis Partners for sponsoring this podcast series. Thank you very much, James.

James White: [00:00:10] Keith, thank you.

[00:00:12] To learn more about the Directors Academy, go to directors academy dot com.